Following the announcement of the crisis that’s hit café chain Patisserie Valerie this week, Grimsby-based Insolvency specialists Forbes Burton is urging business owners to seek financial advice before it’s too late. 

Managing Director at Forbes Burton, Rick Smith, said: “Although the possible collapse of Patisserie Valerie is an undeniably tragic issue, it seems to have been caused by a different reason to the other high street chains we have seen failing in recent times.

“Ultimately, and as with any business, firms need to make sure that their books are in order and directors know what’s going on. What’s perhaps most surprising about the Patisserie Valerie crisis is that the board have only recently discovered that there are accounting irregularities, a shortfall in the reported finances and the actual finances and an unpaid tax bill of £1 million.

“The board should have been more aware of what was going on in the company finances as the discrepancies seem only to have been brought to light when they inspected the accounts themselves.”

Forbes Burton is committed to a company rescue and recovery culture and has over 30 years’ experience in helping businesses with financial difficulties, insolvency issues and HMRC tax arrears.

While the outcomes and possible repercussions of Patisserie Valerie’s news this week are yet to be revealed, Rick says there needs to be more of a focus on large auditing firms and any unfair practice needs to be addressed.

Rick added: “At this point we don’t know whether Patisserie Valerie is in an irretrievable position, so it may be that if it does fall into administration there will be a buyer or injection of cash, so they will be able to keep the cafés open.

“I would hope that this issue will cast a spotlight on the role of auditors of company accounts as it would also appear that Grant Thornton missed the irregularities as well. There have been quite a few mishaps from the “big five” accounting firms (PwC, KPMG, Ernst Young, Deloitte, Grant Thornton) in the UK recently: Grant Thornton was recently fined £3 million for misconduct of its auditing of the maker of Vimto and there is also the Carillion crisis which unraveled earlier this year and stemmed from auditing failures by two of the “big five”.

After delivering successful workshops in Grimsby and London, Forbes Burton is urging business owners in London to attend its second series of free seminars, taking place next month. Forbes Burton will be giving advice on how to operate a successful company and which pitfalls to avoid.

Forbes Burton has recently been recognised for its work within the turnaround and insolvency industry and has been shortlisted for Boutique Insolvency Firm of the Year at this year’s Turnaround, Restructuring and Insolvency (TRI) Awards. 

To find out more about Forbes Burton, visit: www.forbesburton.com.